Waste Management Inc. v. Superior Court

• Decision Date: 01 June 2004
• Docket Number: No. D042260.,D042260.
• Citation: 13 Cal.Rptr.3d 910,119 Cal.App.4th 105
• Court: California Court of Appeals Court of Appeals
• Parties: WASTE MANAGEMENT INC., et al., Petitioners, v. The SUPERIOR COURT of San Diego County, Respondent; Rosa M. Guzman de Peralta et al., Real Parties in Interest.

13 Cal.Rptr.3d 910

119 Cal.App.4th 105

WASTE MANAGEMENT INC., et al., Petitioners, v. The SUPERIOR COURT of San Diego County, Respondent Rosa M. Guzman de Peralta et al., Real Parties in Interest.

No. D042260.

Court of Appeal, Fourth District, Division 1.

June 1, 2004.

Rehearing Denied June 25, 2004.

Review Denied September 22, 2004.^*

Crowe & Rogan, J. Michael Crowe and Robert A. Philipson, Santa Monica, for Petitioners.

No appearance for Respondent.

The Turley Law Firm and William Turley for Real Parties in Interest.

McCONNELL, P.J.

Rafael Peralta Rios (Rafael) was killed by a trash truck while working as a mechanic for Waste Management of California, Inc. (WMCI). His wife and children (collectively the Peraltas) filed a workers' compensation claim against WMCI.¹ They also sued Waste Management, Inc. and USA Waste of California (together WMI) for negligence and wrongful death, alleging WMI controlled the budget of WMCI, its subsidiary, and thereby prevented WMCI from replacing or repairing dangerous and improperly maintained trash trucks, including the one that killed Rafael. The court overruled WMI's demurrer to the first amended complaint (complaint) and denied its motion to strike the Peraltas' claim for punitive damages. We conclude the Peraltas cannot state a cause of action against WMI and accordingly grant its petition for writ of mandate.

FACTUAL AND PROCEDURAL BACKGROUND

The complaint alleges² WMI and WMCI are separate entities. The trash truck that killed Rafael was in disrepair due to the acts or omissions of WMI, specifically WMI's control of WMCI's budget, which prevented WMCI from repairing or replacing the truck. WMI breached its duty of care to Rafael by ordering WMCI not to replace the defective truck and refusing WMCI's request to replace the truck even though WMI knew of the truck's dangerous condition. WMI, motivated by greed and the desire to place its own profits over the safety of others, had a policy of requiring WMCI to reduce its overhead and operating expenses. As a result of these acts and omissions, Rafael suffered serious injury and death.

WMI demurred to the complaint on the grounds: (1) the Peraltas' claim for negligent control of a subsidiary corporation does not state a cause of action; (2) the Peraltas did not allege facts showing any independent basis for imposing liability on WMI; (3) the Peraltas' allegations show WMI is a coemployer and thus their action is barred by the exclusive remedy of workers' compensation; and (4) the Peraltas have not alleged facts to show how WMI's negligence caused Rafael's death. The court overruled the demurrer and also denied WMI's motion to strike the Peraltas' punitive damages claim.

DISCUSSION

I

In reviewing a ruling on demurrer, we exercise our independent judgment on whether, as a matter of law, the complaint states a cause of action. (Lazar v. Hertz Corp. (1999) 69 Cal.App.4th 1494, 1501, 82 Cal.Rptr.2d 368; Trinkle v. California State Lottery (1999) 71 Cal.App.4th 1198, 1201, 84 Cal.Rptr.2d 496.) We accept as true the properly pleaded material facts but do not assume the truth of contentions, deductions or conclusions of fact or law. (Interinsurance Exchange v. Narula (1995) 33 Cal.App.4th 1140, 1143, 39 Cal.Rptr.2d 752; Hernandez v. City of Pomona (1996) 49 Cal.App.4th 1492, 1497, 57 Cal.Rptr.2d 406.) We examine the complaint's factual allegations to determine whether they state a cause of action on any available legal theory. (Wolfe v. State Farm Fire & Casualty Ins. Co. (1996) 46 Cal.App.4th 554, 560, 53 Cal.Rptr.2d 878.)

II

"A tort, whether intentional or negligent, involves a violation of a legal duty, imposed by statute, contract or otherwise, owed by the defendant to the person injured." (5 Witkin, Summary of Cal. Law (9th ed. 1988) Torts, § 6, p. 61; Romero v. Superior Court (2001) 89 Cal.App.4th 1068, 1078, 107 Cal.Rptr.2d 801.) Without such a duty, any injury is injury without wrong. (5 Witkin, supra, § 6, p. 61; Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 57-58, 77 Cal.Rptr.2d 709, 960 P.2d 513 [duty is threshold element of cause of action for negligence].) "The existence and scope of duty are legal questions for the court." (Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 477, 110 Cal.Rptr.2d 370, 28 P.3d 116; Ann M. v. Pacific Plaza Shopping Center (1993) 6 Cal.4th 666, 674, 25 Cal.Rptr.2d 137, 863 P.2d 207.)

The harm for which the Peraltas seek damages was suffered by Rafael in the course of his employment with WMCI. Thus, the existence of any duty owed by WMI arises in the context of Rafael's employment with WMCI.

III

Under the workers' compensation scheme, an employee's remedy against an employer for a work-related injury is generally limited to the benefits provided by statute. (Lab.Code, § 3601.) Nevertheless, a plaintiff who recovers workers' compensation from an employer can pursue common law tort actions against third parties for independent acts of negligence. (Lab.Code, § 3852; Privette v. Superior Court (1993) 5 Cal.4th 689, 697, 21 Cal.Rptr.2d 72, 854 P.2d 721; Orosco v. Sun-Diamond Corp. (1997) 51 Cal.App.4th 1659, 1664, 60 Cal.Rptr.2d 179.) This rule applies even if the third party tortfeasor is the parent company of the plaintiff's employer, as long as there are independent acts of negligence. (Gigax v. Ralston Purina Co. (1982) 136 Cal.App.3d 591, 598, 186 Cal.Rptr. 395 (Gigax); Boggs v. Blue Diamond Coal Co. (6th Cir.1979) 590 F.2d 655, 662.) However, a parent corporation is not liable for injuries of a subsidiary's employee in the absence of evidence establishing a duty owed by the parent corporation to the employee. (Rick v. RLC Corp. (E.D.Mich.1981) 535 F.Supp. 39, 44.) Although the relationship of parent and subsidiary does not by itself give rise to any duty on the part of the parent to the subsidiary's employees, the parent may owe a duty arising out of obligations independent of the parent-subsidiary relationship. (Ibid.)

Employers have a nondelegable duty to furnish their employees with a safe place to work. (Lab.Code, § 6400; Bonner v. Workers' Comp. Appeals Bd. (1990) 225 Cal.App.3d 1023, 1035, 275 Cal.Rptr. 337; Levels v. Growers Ammonia Supply Co. (1975) 48 Cal.App.3d 443, 121 Cal.Rptr. 779; see also Lopez v. University Partners (1997) 54 Cal.App.4th 1117, 1126, 63 Cal.Rptr.2d 359 [duty to provide safe workplace is imposed only on worker's immediate employer or those who contract for services of immediate employer but retain control over work].) An employer's parent corporation is not responsible for the working conditions of its subsidiary's employees based on the existence of the parent-subsidiary relationship. (Muniz v. National Can Corp. (1st Cir.1984) 737 F.2d 145, 148; Rick v. RLC Corp., supra, 535 F.Supp. at pp. 42-43.) Rather, the parent corporation may be liable only if it assumes a duty to act by affirmatively undertaking to provide a safe working environment at the subsidiary's workplace. (Muniz v. National Can Corp., supra, at p. 148; Hinkle v. Delavan Industries, Inc. (W.D.Tenn.1998) 24 F.Supp.2d 819, 821; cf. Johnson v. Abbe Engineering Co. (5th Cir.1984) 749 F.2d 1131, 1133 [parent company liable for injuries to subsidiary's employees where parent undertook to conduct and oversee safety inspections for subsidiary].) To impose liability for an employee's injuries based solely on a parent-subsidiary relationship would result in treating the parent as an employer without providing it with the shield of employer immunity under workers' compensation laws. (Love v. Flour Mills of America (10th Cir.1981) 647 F.2d 1058, 1063.) Moreover, without a showing of an independent tort, plaintiffs would be able to obtain double recovery for the same act, a result that would undermine the central purpose of the workers' compensation system. (Shields v. County of San Diego (1984) 155 Cal.App.3d 103, 112, 202 Cal.Rptr. 30.)

IV

The Peraltas have not alleged any independent tort committed by WMI. There are no allegations WMI assumed a duty to ensure the safety of WMCI's employees, or that WMI owned, operated, manufactured, sold or serviced the truck that killed Rafael. In this regard, the Peraltas' reliance on the Sixth Circuit Court of Appeals' decision in Boggs v. Blue Diamond Coal Co., supra, 590 F.2d 655 is misplaced. In Boggs, the court held the parent corporation was not exempt from tort liability for a mining disaster that killed the subsidiary's employees. (Id. at p. 663.) The parent corporation, having primary responsibility for mine safety functions, engaged in active misfeasance when it authorized removing existing ventilation and safety devices in the mine and concealed the changes from the mine inspectors who could have prevented the accident. The changes made by the parent corporation caused the explosion. (Id. at p. 658.)

Here, in contrast, there are no allegations WMI committed any independent acts of negligence or misfeasance. Unlike the parent corporation in Boggs, WMI did not direct its subsidiary's safety operations. The responsibility for worker safety belonged to and remained with WMCI, which provided the allegedly defective truck and exclusively controlled the truck, the work site and the injured employee. (Kirk v. Kemp Bros. (1970) 12 Cal.App.3d 136, 141, 90 Cal.Rptr. 553 [person in control of premises is employer subject to statutory, nondelegable duty to provide safe place of employment].) Significantly, the Peraltas have not alleged WMI ordered or required WMCI to continue using the trucks, but only that WMI refused to allocate corporate funds to repair or replace those trucks as a cost-savings measure.

Moreover, nothing in the holding of Boggs relieves a subsidiary's employee of the burden of proving the elements of a negligence cause of action against the parent, including the threshold element of a duty owed by the parent to the employee. (See Rick v. RLC Corp., supra, 535 F.Supp. at pp. 44-45.) Even if, as the Peraltas'...